Frequently Asked Questions

Q. What happened/why is U of G in this position?: A. The University of Guelph, like other Ontario universities and many provincial funding agencies, is facing significant financial challenges that are the result of a variety of factors. The global economic downturn has affected our pension and endowments funds, at the same time we are facing a government funding freeze on our operating grants and a significant structural deficit that has resulted from funding significantly lagging behind operating costs for several years. We also continue to face rising costs for salaries and benefits, post-employment benefits such as pensions, deferred maintenance and utilities.
Q. Didn't the government decide NOT to cut funding to universities?: A. The government is flatlining support for the next two years. This constitutes a budget cut because we have annual cost increases that we need to cover and we anticipated receiving modest government increases in our four-year budget targets. We now need to find additional funds.
Q. How much more money are we talking about?: A. The effective freeze on government spending means we will have to find another $5 million in operating revenues or savings by 2009/2010. This is in addition to the budget targets that are part of our multi-year budget plan approved in June to help address the structural deficit.
Q. What did that plan entail?: A. The multi-year budget plan involves reducing costs university-wide for the next four years (2.5 per cent for 2008/2009, five percent for 2009/2010 and 2010/2011 and four per cent for 2011/2012). Under this plan, the deficit would be eliminated by 2011/2012. However, a key component was the assumption that there would be some increase in provincial funding.
Q. How large is the structural deficit and how did it evolve?: A. We also have a structural deficit of $16 million, the result of funding significantly lagging behind operating costs increases for several years.
Q. So what happens now?: A. The $5-million financial challenge will be rolled into the 2009/2010 fiscal-year targets, and we’ll be amending the multi-year plan to address the need for this additional funding. Deans and division heads will be asked to prepare revised plans that identify the additional funds needed.
Q. What else is the University doing to cut costs?: A. Major building projects not in progress will be postponed or suspended. Departments and units are being asked to reduce discretionary expenditures, such as travel and special events, and to consider ways to restructure practices to accommodate the personnel losses due to the voluntary early retirement/resignations.
Q. Will there be a hiring freeze?: A. Yes, for six months. This hiatus will provide time for the University to align its strategies with the fiscal realities. The freeze does not apply to positions associated with ancillary budgets (e.g. hospitality services) or positions associated with the OMAFRA contract or funded via external sources.
Q. How do the staff "buy outs" that we've heard about and read in the newspapers help the bottom line?: A. The voluntary retirement resignation program helps colleges and directorates achieve necessary base-budget reductions by minimizing involuntary reductions. Approval is only granted in cases where a budget-savings will result.
Q. How many people took a VERR?: A. U of G approved 144 staff for the program, about 67 per cent of those who applied. The retirements/resignations take effect between now and May 2010. There is a comparable program for faculty that is part of the collective agreement.
Q. Are you expecting to make program cuts?: A. With a fiscal challenge of this order and magnitude, we recognize that we must change the way we do our core business of teaching and research. There is bound to be restructuring, especially in the academic delivery of programs. This will result in fundamental changes to the institution, but universities, like other sectors, must reduce the scope and scale of operations in these uncertain times.
Q: Will there be layoffs?: A: It's too early to say what the final impact on people might be. While we expect that this level of budget reduction will necessitate changes in some departments, we cannot automatically assume layoffs will happen.

Frequently Asked Questions

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